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Startups and young brands must follow these six points to launch, survive and thrive in the competitive cosmetics category.
January 2, 2024
By: Karen Young
CEO
Indie brands now make up between 20% and 30% (depending on whose numbers you believe) of the total beauty business and they continue to grow, outpacing the established brands. Indie beauty brands are changing the way the industry functions. We know that for every one that survives, there are many that don’t. McKinsey puts the success rate at 20%. Not great… It’s a long, expensive journey with many obstacles scattered along the way. I tell brands it will cost twice what they imagine and require twice the time they think. Yet brands continue to try. Our industry always makes room for an innovative, fresh approach from a focused, smart brand that ticks all the boxes. These upstart brands are changing the model. They are usually closer to the consumer than legacy brands and willing to listen to their customers. They are nimble and flexible. They can move and change course quickly. Their focus on transparency, sustainability, inclusivity, “natural,” and going where the consumer is puts them in a different playing field compared to established brands for whom most of these requirements are a foreign language. Indie brand genesis is often the search for a solution: problematic skin conditions, allergic reactions, messed up tattoos, a more user-friendly approach for people with disabilities, customized formulas, challenging hair textures, previously neglected body parts (pubic hair!)… the list is long. Creating and maintaining a unique selling proposition (USP) requires discipline. Sorting out distribution (and distributors)—DTC, bricks and mortar, Amazon, social selling—all of this is nothing short of a nightmare. There’s no playbook to use as a frame of reference. These platforms change and reinvent themselves frequently. It’s tough to stay focused. Innovative marketing is critical, and often the unexpected and unplanned are the default (a TikTok viral video is never on the calendar). Young brands need a vision, a plan and a strategy, and they must be willing to pivot and course correct when the plan isn’t working. For beauty industry outsiders, navigating formula creation, selecting a contract manufacturer, choosing the right packaging, vetting a creative agency, determining a realistic budget and sorting out the right distribution channels are all daunting; and daunting for many industry insiders as well, I might add. After many years of working with small brands, some who survived and some who didn’t, I have a list of must-do’s. They shift and change from time to time, based on the consumer and the market place, but here’s my latest collection of what startups and young brands must do to launch, survive and thrive.
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